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The notorious Goldman Sachs Group (GS) continues to attract Wall Street's attention, with the investment bank preparing to submit to a Congressional grilling this week. Meanwhile, in a strangely similar development, Visa Inc. (V) is attempting to placate a few irritated regulators in the European Union. Finally, in a completely different sector of the economy, Under Armour (UA) is on the upswing as traders anticipate tomorrow's earnings release -- but can the company continue its pattern of topping expectations? (OK, I have no idea. That's just a cheap cliffhanger.)
So, embattled Goldman Sachs Group (GS) is headed to Capitol Hill. On Tuesday, CEO Lloyd Blankfein, deviant trader Fabrice Tourre, and three other executives are slated to testify before the Senate Permanent Subcommittee on Investigations in relation to pending fraud charges. Fox Business is reporting that Blankfein will defend Tourre, with the CEO arguing that the trader did nothing illegal, but simply showed immaturity and poor judgment (not to mention poor grammar and spelling -- have you seen the emails?).
Traders today are voicing a lack of confidence in GS, with the stock off nearly 3% this afternoon. However, in this Newsweek article, Fareed Zakaria argues that we shouldn't be giving Goldman such a hard time. Although the bank might have been "dodgy" and "unethical" in its approach, "that's not the same as illegal," writes Zakaria. And didn't our founding fathers envision a country where banks could freely engage in dodgy and unethical behavior in the name of profits? I think I remember something along those lines in the Declaration of Independence.
On a more upbeat note, Under Armour (UA) tagged a new 52-week high of $36.22 earlier today, with the stock extending its year-to-date rally of roughly 30%. This technical breakout precedes UA's turn in the earnings confessional, with the athletic apparel issue scheduled to release its first-quarter results before the opening bell tomorrow. Analysts are looking for a profit of 10 cents per share, up from 8 cents per share in the year-ago period.
UA has exceeded consensus earnings estimates in each of the past four reporting periods, which could explain why the stock is trekking higher ahead of its quarterly release. Another upside surprise could potentially shake loose a legion of bearish bettors -- short interest accounts for a whopping 19.6% of UA's float, and traders on the International Securities Exchange (ISE) have bought to open 2.28 times more puts than calls during the past 10 days.
Finally, Visa Inc. (V) is in focus today, after Visa Europe consented to lower some of the fees it collects on debit-card transactions in order to appease antitrust regulators in the European Union (EU). The move hasn't been formally approved by the EU, but spokeswoman Amelia Torres said the change was "good for consumers because it is bringing down the cost of cards."
After touching a new annual peak of $97.19 earlier today, V has backpedaled into the red. The shares are attempting to establish a foothold above the $95 level, which acted as short-term resistance before giving way last Thursday.